Investing Vocabulary

Diversification

By Elizabeth Hope Wright

My portfolio includes shares in companies such as Google (a large tech company) and Eagle Materials Inc. ( a small building materials company).

Example

A wide variety of investments in a portfolio; a stock

portfolio would include a variety of sectors

​Definition

Diversification - Investing

Technology, Healthcare, Energy, Real Estate and Basic Materials are all examples of sectors that a company may fall into.

​Example

A type of industry that share common products

Definition

Sector

The price for a share of company A is $200. There are 5,000 shares of the company. The company has a value or Market Cap of $1 million.

​Example

Total dollar value of a company. (Market Capitalization)

Definition

Market Cap

A company goes public offering 2000 shares, but only 1750 are purchased by shareholders. The outstanding shares for the company are 1750.

​Example

Stock currently held by shareholders

Definition

OUTSTANDING SHARES

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Example

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​Definition

Saving